In The Social Meaning of Money we see how welfare monies have been argued over and policed. While a more efficient solution would be to provide simple cash transfers rather than attaching strings that cost money to monitor, most service delivery programs have paid more attention than seems prudent to how the poor and the otherwise disadvantaged use and understand their funds. In Money Talks, we extend this conversation to address this proliferation of policy monies.

Our introduction draws on work by Jennifer Sykes, Katrin Kriz, Kathryn Edin, and Sarah Halpern-Meekin on Earned Income Tax Credit, which is one kind of policy money. It is not welfare. This is a crucial distinction that explains why EITC as a policy program has gained greater legitimacy among policy makers than welfare cash transfers. And this is not because EITC is a less expensive policy than welfare cash transfers. It is the way the money is given and what it means. Welfare has such poor connotations among Americans. It goes so counter to American values of work ethic and pulling yourself up by the bootstraps. The Earned Income Tax Credit, which was developed by the Clinton administration, with bipartisan support, was intended for low income working families, in a form of a small tax credit, and administered by the IRS. As such, because of its form and for what is intended, it was more acceptable than a cash welfare program. Not only for policy makers but by low income recipients themselves, who perceive it as a more dignified transfer. Kathryn Edin, H. Luke Shaefer and Laura Tach, reported on how those claiming the credit at tax time, expressed feeling “like a real American,” like they are part of society, rather than discarded from it. They also noted how they wanted their children to have experiences like those of other children. Having the right kind of money made a big difference.

Parents used their EITC money to pay bills or to pay down debts, to increase their savings, to offer their children special treats, and to subsidize a family trip to see relatives. The purposes to which recipients put the money and its intended beneficiaries (family members) meant that these lump sum payments would be disaggregated and some of its parts deemed nearly non-fungible. This was not simply the outcome of a cognitive process of classification as the mental accounting perspective would suggest. Rather, monetary differentiation was wrapped in relationships and moral concerns, as people managed their EITC monies to work on their relationships.

While Kathy Edin, Luke Shaefer, and others examine the dignity-enhancing ways of framing and delivering social service assistance, Fred Wherry, Kristin Seefeldt and Anthony Alvarez have begun to ask these questions of credit, credit scoring, and programs at the Mission Asset Fund intended to improve the credit histories and financial lives of its participants. (This work is ongoing.) Is there a way that the “lending circle” monies are used that differ from other monies? How is credit talked about, understood, and relationally marked by its users? What lessons might there be for other alternative financial services as well as those services delivered by credit unions and mainstream banks?